The new (fashion) deal
10 March 2019
Things are moving fast! This week, TrueFit, the fashion genome to help people buy the right size in their brands, celebrated its 100 millions users. If that isn’t a feat, what is?
On the other side, brands that aren’t embracing the new wave, are being left behind, for various reasons.
Diesel USA has just filed for bankruptcy according to Business of Fashion “blaming plummeting sales, a botched turnaround, pricey leases and unwavering landlords — plus several instances of cyber fraud and theft”. But we are talking about one of the most iconic jeans’ brands since the 1980s, and the love brand for high-end denim. So what happened?
Payless, the low-priced shoe store, also filed for bankruptcy last month, is abandoning 2,500 stores. Victoria’s Secret, known for the extravagant fashion shows, and Gap, are among those planning to reduce their footprints.
In Spain, other brands are finding themselves in a similar situation, like Intropia or El Ganso, who have stores In Spain but also in other European countries.
Cache, Wet Seal, Quicksilver, and American Apparel filed for bankruptcy in 2016 and 2017. Teen brands have had to adapt to their target (who is almost 100% online, on social media and diverse), like Zara, H&M and Forever 21. Others didn’t and the bill is extremely heavy.
There are many possible reasons for this:
Outside investors: On one side, there has been an enormous participation of outside investors who have been injecting money in brands to accompany their growth. Conflicting goals, high expectancies on the short-term, search for huge profits, and lack of common vision has made some of these partnerships very dangerous for companies.
Online : Brands with a high concentration of physical stores have had to reinvent themselves. Omni-channel means that the relationship between online and offline must be seamless. The brands that haven’t embraced technology completely have fallen behind and this is just the beginning. And here I don’t mean paying a few influencers to wear a handbag or dress. I mean creating a brand presence online where the community or the customer is the actor.
Millennials? So what: Why does everyone have the word “Millennial” on their lips? Because they define the future of fashion retail. They have evolved as customers. Yes they are digitized, but they are also conscious and want brands that are sustainable, that have meaning, that listen to them. They will choose brands that see them as diverse in color, size, interests and beliefs as they are in true life. No one cares or looks up to the white, size 36 model anymore.
“Too many clothes, too little customers”, as Techpacker says. There is tremendous competition, and those left behind have little to hope for. Brands are having trouble controlling their brand image online.
Experience: This is the key word that will make a difference in the fashion retail industry today. It is the unique element that will get customers into the stores, with installations, special collections, navigating through the store with your smartphone for being oriented to what you are interested in, in other words personalization...
Doers: Among the best practices, Nike has taken control of its brand online. Apart from the impressive Nike.com website, they have, apart from the Nike apps for running or for kids, developed a new retail app called Enty to drive traffic to its stores. Their flagship stores are directly linked to the app. Nike's House of Innovation includes features like Instant Checkout, Shop the Look and Scan to Try, all powered by the Nike application.
Artificial intelligence: The solution to all problems in retail seems to be Artificial Intelligence (with capital letters), but it is only tool. It can be used, but not abused, and one has to make sure to get the right data from it. Remember, we are not predictable, so stop guessing and surprise us!
And the show goes on….
©I-DYLIC. Article by Eleonore Vadon